P60's...

System
System Posts: 100,537 🤖 Admin 🤖
edited June 9 in General accounting discussion
Can someone please clarify this...

Does an employer have to produce a P60 for an employee who does not earn enough to pay NI or Tax?

Big disagreement going on between friend of mine and her employers as inland revenue have told her she needs one and employer has said she does not earn enough to have one!!!

Thanks !! :D

Comments

  • System
    System Posts: 100,537 🤖 Admin 🤖
    Re:P60's...

    How else does she prove her earnings for the year?

    She receives payslips, so she should receive a P60. Should be any trouble for the employer... :? just maybe, they haven't declared her income on their P35!

    When the employer prepare's the P35, most places now do it online.... if all employee details are enter, the revenue webby produces P60's automatical.

    Regards

    Dean
  • System
    System Posts: 100,537 🤖 Admin 🤖
    Re:P60's...

    apparently they only pay each employee less than £80 per week, and do not fill out p35, as none of them pay NI or TAX!!!!
  • System
    System Posts: 100,537 🤖 Admin 🤖
    Re:P60's...

    That makes no difference - if they prepare payroll they should still produce a P35/P14/P60 for each employee. Your friends employers are talking rubbish.

    Regards
    Steve
  • System
    System Posts: 100,537 🤖 Admin 🤖
    Re:P60's...

    Sounds like the employer is not registered as an employer - otherwise HMRC would be fining them for not returning the P35.
    Do they issue P45s for leavers, pay SSP/SMP etc etc?
  • System
    System Posts: 100,537 🤖 Admin 🤖
    Re:P60's...

    no, they seem to think they do not have to issue anything as all their employees pay NO tax or NI as below threshold! i dont think they are registered at all with IR! trouble is, she gets FTC and they now want her to produce p60! her employer thinks that thety dont need to issue one and i have told her that they do!
  • System
    System Posts: 100,537 🤖 Admin 🤖
    Re:P60's...

    Your friend's employer is on very dodgy ground here. Even if your staff do not pay tax/nics they are still receiving employed income which is governed by the PAYE/NIC legislation. Even if an employer deducts no tax or nic from their employees for the whole of the tax year, then they should still complete a P35/P14/P60 for each employee, even though the entries on the P35 will be nil.

    I am surprised that the accountants of the firm your friend works have never advised the employer.

    Steve
  • System
    System Posts: 100,537 🤖 Admin 🤖
    Re:P60's...

    thanks everyone. I knew i was right!! I have passed on all your comments to her and she is now on the case! I dont think they have been dodging, their accountant apparently has not advised them! I told her that maybe they ought to check his credentials!!
    Cheers to all for inputs. :)
  • System
    System Posts: 100,537 🤖 Admin 🤖
    Re:P60's...

    Does your friend earn above the PAYE thresehold? An employer does not have to register for PAYE if non of their employees earn above the thresehold, do not have other jobs, or any benefits in kind.

    Here's a link to HMRC's website which shows this:
    http://www.hmrc.gov.uk/employers/first_steps.htm


    However, it is usually best practice to register as an employer even if no employees have any deductions (especially if they file online and therefore get £250 tax free!)
  • System
    System Posts: 100,537 🤖 Admin 🤖
    Re:P60's...

    I am confused now! I read your link - thank you. I think I will call the helpline to check as it seems as though there is some confusion over this one!
  • System
    System Posts: 100,537 🤖 Admin 🤖
    Re:P60's...

    If your friend's employers won't give a P60 ask the Revenue if they will accept a letter from the employers stating the income your friend had for the year.

    This letter should contain the employers name, address etc. and the business owners Unique Tax Reference number.

    If the employer is not registered for PAYE (because no employees earn above the thresehold) they will not have a PAYE reference. I know that if I was relying on a P60 as proof of income, the fact that it does not contain a PAYE reference would not make my put much trust on it, I would want something else.
  • System
    System Posts: 100,537 🤖 Admin 🤖
    Re:P60's...

    For what it's worth...

    P14s/P60s are only issued to employees earning above the Lower Earnings Limit.
    If the total income over the tax year is under the LEL, a nil P35 is submitted along with form 38A showing details employees under the threshold. The employee would have to rely on a letter from the employer to substantiate their income.
    The online filing incentive is only payable where P14s are submitted. If you use the revenue software, it will not allow you to complete a P14 if the total income is under the LEL.

    Hope this helps.

    Sharon H

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